U.S. SECURITIES AND EXCHANGE COMMISSION
                                 Washington, D.C. 20549

                                       FORM 10-Q

(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 2001

                                          OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM
______________ TO ______________


                         COMMISSION FILE NUMBER: 33-43621


                     INTERNET BUSINESS'S INTERNATIONAL, INC.
            (Exact name of registrant as specified in its charter)


              Nevada                                   33-0845463
(State or jurisdiction of incorporation            ( I.R.S. Employer
            or organization)                      Identification No.)

   4634 South Maryland Parkway, Suite 101, Las Vegas, Nevada       89119
        (Address of principal executive offices)                (Zip Code)

                Registrant's telephone number:  (702) 968-0008

        Securities registered pursuant to Section 12(b) of the Act: None

      Securities registered pursuant to Section 12(g) of the Act: Common
                          stock, $.001 par value

     Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the Registrant was required to file such reports),
and (2) been subject to such filing requirements for the past 90 days.
Yes    X      No          .

     As of December 31, 2001, the Registrant had 282,736,029 shares of
common stock issued and outstanding.

                               TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION                                       PAGE

     ITEM 1.  FINANCIAL STATEMENTS

              CONSOLIDATED BALANCE SHEETS
              AS OF DECEMBER 31, 2001 AND JUNE 30, 2001                 3

              CONSOLIDATED STATEMENTS OF OPERATIONS
              FOR THREE MONTHS AND SIX MONTHS ENDED
              DECEMBER 30, 2001 AND DECEMBER 30, 2000                   4

              CONSOLIDATED STATEMENTS OF CASH FLOWS
              FOR THE SIX MONTHS ENDED
              DECEMBER 31, 2001 AND DECEMBER 31, 2000                   5

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                6

     ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF
              FINANCIAL CONDITION AND RESULTS OF OPERATIONS            23

     ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES
              ABOUT MARKET RISK                                        27

PART II - OTHER INFORMATION

     ITEM 1.  LEGAL PROCEEDINGS                                        28

     ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS                28

     ITEM 3.  DEFAULTS UPON SENIOR SECURITIES                          28

     ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS      28

     ITEM 5.  OTHER INFORMATION                                        28

     ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K                         28

SIGNATURE                                                              29

PART I.

ITEM 1.  FINANCIAL STATEMENTS.

                   INTERNET BUSINESS'S INTERNATIONAL, INC.
                         CONSOLIDATED BALANCE SHEETS
                                 (Unaudited)

                                                 December 31       June 30
                                                     2001            2001
                                     Assets

Cash and cash equivalents                        $    274,396     $   258,019
Accounts receivable, net                              293,930         200,968
Inventories                                           287,869         166,307
Mortgage notes held for sale                        6,388,740       6,929,724
Prepaid expenses and other                            201,250         106,092

Total current assets                                7,446,185       7,661,110

Property and equipment, net                         2,175,425       1,869,761

Intangible assets, net                              2,256,211       2,543,697

                                                 $ 11,877,821     $12,074,588

                     Liabilities and Stockholders' Equity

Accounts payable                                 $    575,366     $   559,292
Accrued liabilities                                   101,557          40,963
Revolving line of credit                            5,887,698       6,230,678
Current portion of long-term debt                       8,425          14,048
Deferred revenues                                      13,013          56,966
Other current liabilities                               0                   0

Total current liabilities                           6,586,059       6,901,947

Long-term debt                                        323,520       1,168,453

Stockholders' equity:
Preferred stock, par value $100.00 per share;
 1,000,000 shares
 Authorized: There are no issued and outstanding
 as of this date.                                          0                0
Common stock, par value $0.01 per share; 349,000,000
shares authorized; 282,736,029 shares issued and
outstanding at September 30, 2001 and
 June 30, 2001                                     2,827,360        2,672,360
Additional paid-in capital                         3,669,490        3,669,490
Accumulated deficit                               (1,528,608)      (2,337,662)

Total stockholders' equity                         4,968,242        4,001,188

  Total liabilities and stockholders' equity     $11,877,821      $12,074,588

The accompanying notes are an integral part of these financial statements

                      INTERNET BUSINESS'S INTERNATIONAL, INC.
                       CONSOLIDATED STATEMENTS OF OPERATIONS
                                     (Unaudited)

<TABLE>
<CAPTION>
                                                  Three Months Ended              Six Months Ended
                                              December 31       December 31    December 31    December 31
                                                 2001               2000          2001          2000
<S>                                           <C>               <C>            <C>            <C>
Revenues                                      $  2,538,067      $  6,539,850   $  4,522,726   $ 13,439,787
Cost and expenses:
 Cost of revenues                                    5,082         5,108,321         11,212     11,173,187
 Interest expense                                        0                 0              0          2,726
 Selling, general and administration             1,980,051         1,583,242      3,598,865      3,420,286
 Depreciation and amortization                     580,743            47,163        824,440        289,322

  Total costs and expenses                       2,565,876         6,738,726      4,434,517     14,885,521

(Loss) income from operations                      (27,809)         (198,876)        88,209     (1,445,734)
Other income (expense):
 Other income or (expense)                           3,909           102,117         13,065        410,529
 Interest income                                         0           218,018              0        279,160
 Other expenses                                    (6,003)            (1,806)        (6,651)        (6,047)

   Total other income, net                         (2,094)            318,329         6,414        683,642

Income (loss) before minority interest            (29,903)            119,453             0       (762,092)

Minority interest in loss of subsidiaries               0              10,170             0         29,828

Net (loss) income                                  (29,903)            129,623       94,623       (732,264)

Net loss (income) per common                           Nil                  Nil         Nil            Nil

Weighted average number of common
shares  outstanding                            282,736,029          225,539,580  282,736,029   225,539,580
</TABLE>


The accompanying notes are an integral part of these financial statements

                        INTERNET BUSINESS'S INTERNATIONAL, INC.
                         CONSOLIDATED STATEMENTS OF CASH FLOWS
                                      (Unaudited)

                                                         Six Months Ended
                                                  December 31      December 31
                                                       2001            2000

Cash Flows From Operating Activities:
 Net (loss) income                                $       94,623   $  (732,264)
 Adjustments to reconcile net (loss) income to
 Net cash (used in) provided by operating
 activities:
  Depreciation and amortization                          602,738       289,322
 Reserve for loss on notes receivable                     85,370
 Reserve for loss on mortgage loans receivable           251,900
 Gain on sale of equity investment                             0      (410,529)
 Minority interest                                             0       (29,828)
Changes in operating assets and liabilities:
 Accounts receivable                                    (293,930)       83,316
 Inventories                                            (287,869)            0
 Mortgage loans receivable net                          (501,042)      569,110
 Prepaid expenses and other                              201,250        16,794
 Accounts payable                                        575,366        57,254
 Accrued liabilities                                     101,577        47,005
 Deferred revenues                                        13,013       (16,984)
 Other current liabilities                                     0             0

Net cash (used in) provided by operating activities      842,996      (126,804)

Cash Flows From Investing Activities:
 Purchases of property and equipment                    (245,405)     (292,896)
 Investment in intangible assets                               0             0
 Proceeds from sale of investment in company                   0       559,812
 Investments notes or stocks                                   0    (1,025,357)

Net cash used in investing activities                   (245,405)     (758,441)

Cash Flows From Financing Activities:
 Net repayments under revolving line of credits         (567,028)     (627,784)
 Net repayment of long-term debt                               0       177,740
 Collection of notes receivable                                0        32,182
 Issuance of common stock                                      0             0

Net cash (used in) provided by financing activities     (567,028)     (417,862)

Net decrease in cash                                      30,563    (1,303,107)

Cash, beginning of period                                243,833     1,661,963

Cash, end of period                                      274,396       358,856

The accompanying notes are an integral part of these financial statements

                    INTERNET BUSINESS'S INTERNATIONAL, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                    (Unaudited)

1.  DESCRIPTION OF BUSINESS AND CHANGE IN CONTROL

Prior to December 31, 1997, Internet Business's International, Inc.
(the "Company") was in the food product manufacturing business
formerly known as "International Food and Beverage, Inc.".  In
November 1998, new stockholders bought majority control from the
previous Chief Executive Officer through a private transaction.
Immediately thereafter, the former CEO resigned and the new
stockholders assumed the executive management positions.  In December
31, 1998, after new management was in place, a decision was made to
change the Company's principal line of business from a manufacturing
business to a high technology company. In connection with the change
in business, the Company changed its name from International Food &
Beverage, Inc. to Internet Business's International, Inc., and
reincorporated the Company on December 8, 1998 in the state of Nevada.
The Company, after January 1, 1999 began plans to offer Internet based
e-commerce services. In April of 1999, the Company announced its first
e-commerce site and was engaged in the development, operation and
marketing of a number of commercial Internet web sities. The Company
currently operates four reporting divisions made up of subsidiaries
and or divisions of the Company. The four divisions are as follows:
Lending on Line (which includes real estate loans and equipment
leasing), Internet Service Provider (which includes a national
Internet access dial-up service, wireless high speed Internet access
in Las Vegas, Nevada and Woodland, California, and Internet web design
and hosting), E-commerce (which includes auction sites, B2C and B2B
Internet transaction, and reverse auction sites for Europe and the
United States), Direct Marketing (which includes the direct marketing
of long distance phone services, computers with Internet access,
wireless high speed Internet access and  bandwidth, and Internet web
design and hosting). The Company has more than 40 employees and 6
offices in the US and 1 in Europe and.

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The consolidated financial statements include the accounts of the
Company and its wholly owned subsidiaries. Significant intercompany
balances and transactions are eliminated in consolidation. Affiliated
companies in which the Company does not have a controlling interest
are accounted for using the equity method.

Use of Estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities at
the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Significant
estimates include allowances for doubtful accounts, notes receivable
and for mortgage loans receivable.  Actual results could differ from
those estimates.

Reclassifications

Certain amounts in the prior year financial statements have been
reclassified to conform to the current year classification.

Cash and Cash Equivalents

The Company considers all short-term, highly liquid investments with
an original maturity date of three months or less to be cash equivalents.

Change in Revenue Recognition

Prior to July 1, 2001 the revenue for the Mortgage Division was booked
as follows: the mortgage loan amount funded by the Company was booked
as revenue on the date of funding.  After that date, the net proceeds
received from the sale of the mortgage loan was booked as revenue upon
receipt of those funds by the Company.  This has a significant impact
of the revenue for the Company, but does not impact the net income
(loss) for the Company.

Mortgage Loans Held for Sale

Mortgage loans held for sale, are carried at the lower value of either
cost or market value as determined by outstanding commitments from
investors.  The market value of the loans is based on the note rate
and the daily loans yield spread pricing from the bank that is buying
the loans.  When a loan rate is locked, then a corresponding price or
yield is calculated.

Example: note rate of $100,000 with a 7% locked rate from the bank
paying a yield premium of 101.00%.  The value of the note would then
be $101,000. A note rate at 6.875% purchased by the same bank could be
valued at pa,r and therefore the market value is $100,000.

Mortgage loans held for sale are secured by the borrower's mortgaged
property.   Net proceeds resulting from the sale of mortgages are
recognized as revenues on the date the loans are sold to investors.

Property and Equipment

Property and equipment is stated at cost and depreciated or amortized
on a straight-line basis over the estimated useful lives of the assets
or the lease term, whichever is shorter. Estimated useful lives range
from 3 to 7 years.

Capitalized Computer Software

Capitalized computer software included in intangible and other assets,
reflects costs related to purchased Internet websites and related
software that are capitalized and amortized on a straight-line basis
over periods not exceeding five years. Costs incurred to acquire or
upgrade websites and other internal software is capitalized in
accordance with Statement of Position 98-1, Accounting for the Costs
of Computer Software Developed or Obtained for Internal Use.
Amortization expense for second quarter ending December 31, 2001 and
fiscal June 30, 2001 was  $466,901 and $324,910 respectively.

Intangible Assets

The Company has accounted for acquisitions of businesses under the
purchase method, and the excess of the purchase price over the fair
value of the net assets acquired is allocated to subscriber member
bases and customer lists, existing technology, work force in place,
trade names and residual goodwill, which are being amortized on the
straight-line basis over 5 years.

Long-Lived Assets

The Company periodically reviews the values assigned to long-lived
assets and intangible assets, such as property and equipment,
capitalized computer software, goodwill and other intangibles assets,
to determine whether any impairments are other than temporary.
Management reviews the undiscounted projected cash flows related to
such assets and compares them to the carrying value of the assets to
determine if impairment has occurred.  If an asset is deemed to be
impaired, the Company records the difference between the projected
cash flows on a discounted basis or the fair market value (whichever
is more appropriate) and the carrying value as an asset impairment
charge in the period incurred.  There were no such impairments in the
periods presented.  Management believes that the long-lived assets and
intangible assets in the accompanying balance sheets are appropriately valued.

Additional Paid In Capital

By the end of March 2000, the Registrant issued an additional
7,000,000 shares of the Registrant's common stock, in a private
placement to a qualified investor which provided to the Registrant $3,382,560.

There was no additional paid in capital through the second quarter of
this fiscal year ending June 30, 2002.

Revenue Recognition

Revenue is recognized for each of the divisions as follows:

ISP: for services provided fees paid are recognized as revenue. For
design work fees are paid after the work is completed at which time it
is reported as revenue. If the work is complete and has not been paid,
it is a receivable. For services revenue is recognized when paid for
the time frame the services are contracted for. If the company hosts
or provide internet access on a monthly bases then the revenue is
booked as received which is paid in advance of the service actually
being rendered. During this quarter ended December 31 2001, the
company recorded deferred revenues totaling $13,013.

E-commerce: for Auctions normal or reverse fees are paid upon the
completion of the auction and the product is either bought or sold,
revenue is reported only upon receipt of funds.  For services revenue
is recognized when paid for the time frame the services are contracted
for. If we list the company in the directory on a monthly basis, then
we book the revenue as received, which is paid in advance of the
service actually being rendered. For products purchased, we report the
revenue upon receipt of it for products shipped. If the product is not
shipped for any reason, then the funds are returned to the buyer and
there is no reporting of the funds as revenue.

Lending on line; for the real estate loans revenue is booked according
to the net proceeds received from the sale of the funded loans after
they are sold.  Revenue from fees for loans not funded by the company
(brokered loans) are booked upon receipt thereof.  For the on line
leasing, revenue is booked upon receipt of payment for advertising the
web site on the net.

Direct Marketing; for products and or services sold revenue due is
either reported as accounts receivable or as revenue upon receipt of
the funds during this fiscal year

Advertising Expense

All advertising costs are expensed when incurred.

Concentration of Credit Risk

The Company is subject to credit risk through trade receivables.
Monthly Internet access fees and web hosting are generally billed to
the customer's credit card, thus reducing the credit risk.  The
Company routinely assesses the financial strength of significant
customers and this assessment, combined with the large number and
geographic diversity of its customers, limits the Company's
concentration of risk with respect to trade accounts receivable.

Income Taxes

The Company accounts for income taxes under the asset and liability
approach where deferred income tax assets and liabilities reflect the
future tax consequences, based on enacted tax laws, of the temporary
differences between financial and tax reporting at the balance sheet date.

Earnings per Share

Basic earnings per share are computed by dividing net income (loss) by
the weighted average of common shares outstanding for the period.
Diluted earnings per share are computed by adjusting the weighted
average number of shares outstanding during the period for all
potentially dilutive shares outstanding during the period.

New Accounting Pronouncement

SFAS No. 133, "Accounting for Derivative Instruments and Hedging
Activities" establishes accounting and reporting standards for
derivative instruments, including certain derivative instruments
embedded in other contracts (collectively referred to as derivatives)
and for hedging activities. It requires that an entity recognizes all
derivatives as either assets or liabilities in the statement of
financial position and measures these instruments at fair value. SFAS
No. 133 is effective for the Company in the third quarter of fiscal
2002. The Company is currently evaluating what impact, if any, SFAS
No. 133 may have on its financial statements.

3.  ACQUISITIONS AND SERVICE AGREEMENTS

The following notes refer to the Companys acquisitions and service
agreements after July 1, 1999, with the exception of the listing of
the LA Internet acquisition, which occurred in the prior fiscal year
ending June 30, 1999.

In June 1999, the Company acquired the assets of L.A. Internet, a
Southern California-based Internet Service Provider, which included
customer accounts, trade name, websites, etc. for $545,000 in exchange
for a reduction of the Note Receivable from Iron Horse Holdings, Inc.
(see Preferred Stock Note 8).

Proforma information (unaudited) for the year
 ended June 30, 2000:*                                       LA Internet

Revenues                                                     $ 2,500,000
Cost of Operations & Expense                                 $(1,920,000)
Net income (loss)                                            $   580,000
Income or (loss) per share                                   $       nil

July 1999 MBM Capital Group was acquired for $72,000 and 112,667
shares (@ $.01 per share valued at $1,127) the company was sold during
the fiscal year of acquisition for a $150,000 note. After the sale MBM
ceased operations and the Company considers the note valueless.

In August 1999 and November 1999, the Company purchased Net 2 Loan, an
on-line loan processing website and Optical Brigade, an on-line
sunglass distribution website from the same outside party,
respectively.  The total purchase price was 5,050,000 (@ $.01 per
share valued at $50,500) and 400,000 shares (@ $.01 per share valued
at $4,000) of restricted company stock, respectively.

Proforma information (unaudited) for the year
 ended June 30, 2000:*Net                       2Loan         Optical Brigade

Revenues                                        $    630,000  $     360,000
Cost of Operations & Expense                    $   (310,000) $    (150,000)
Net income (loss)                               $    320,000  $     210,000
Income or (loss) per share                      $        nil  $         nil

In December of 1999, the company entered into a service agreement to
market the Company services on the Internet for 6,000,000 shares (@
$.01 per share valued at $60,000).

In February 2000, the Company acquired the assets and assumed certain
liabilities of Direct Communications, Inc., a wireless communications
company.  In addition to assuming certain liabilities, the Company
paid cash of $80,000 and issued 30,000 shares (@$.01 per share valued
at $300) of restricted company stock.  Intangible assets purchased
totaled $265,000, consisting of customers lists, website and
workforce-in-place and is being amortized over 5 years.

Proforma information (unaudited) for the year
 ended June 30, 2000:*                            Allstates Communications

Revenues                                             $   1,200,000
Cost of Operations & Expense                         $    (900,000)
Net income (loss)                                    $     300,000
Income or (loss) per share                           $         nil

In March 2000, the Company acquired the assets and assumed certain
liabilities of Internet 2xtreme, and Internet Service Provider based
in Northern California.  The total purchase price was $735,000, which
consisted of cash of $17,635, restricted company stock amounting to
$186,884  (the company issued 124,589 shares based on the current upon
a share value of $1.50 per share) and assumption of certain
liabilities.  In connection with the acquisition, the Company recorded
intangible assets of approximately $666,000, which consisted of
approximately 4,800 customer accounts, website and workforce-in-place,
and are being amortized over 5 years.

Proforma information (unaudited) for the year
 ended June 30, 2000:*                                     2xtreme

Revenues                                                  $    720,000
Cost of Operations & Expense                              $   (600,000)
Net income (loss)                                         $    120,000
Income or (loss) per share                                $        nil

Also in March 2000, the Company acquired 80% of the outstanding shares
of Global GPP for $500,000.  Global GPP owns a business-to-business
website and has strategic agreements with IBM Hungary to market
business-to-business services in Eastern Europe.

Proforma information (unaudited) for the year
 ended June 30, 2000: *                                     Global GPP

Revenues                                                   $ 11,253,224
Cost of Operations & Expense                               $ (5,444,994)
Net income (loss)                                          $  5,808,230
Income or (loss) per share                                 $        nil

During this quarter an additional 4,113,871 shares (@. 01 per share
valued at  $41,139) for services.

In April 2000, the Company acquired all of the outstanding stock of
Atlas Capital Corporation, a mortgage-banking company, for 600,000 (@
$.01 per share equals $6,000) shares of Company stock.  In connection
with the acquisition, the Company acquired assets of approximately
$3,183,000 and assuming liabilities of approximately $3,179,000.  The
difference of $260,000 was recorded as intangible assets related to
acquisition of trade names, websites, workforce-in-place and is being
amortized over 5 years.

Proforma information (unaudited) for the year
 ended June 30, 2000:*                                     Atlas Capital

Revenues                                                   $ 37,349,000
Cost of Operations & Expense                               $ (2,651,000)
Net loss                                                   $ (2,498,000)
Loss per share                                             $       (nil)

Other acquisitions occurred during the year ending June 30, 2000 were
not deemed to be material transactions.  All acquisitions are
accounted for under the purchase method of accounting and accordingly,
the operations and net assets have been included in the Company's
consolidated financial statements from the date of acquisition.

*The unaudited Proforma information has been prepared assuming that
material acquisitions during the year ended June 30, 2000 have taken
place at the beginning of the respective period presented.  The pro
forma information is not necessarily indicative of the combined
results that would have occurred had the acquisitions taken place at
the beginning of the period, nor is it necessarily indicative of the
result that may occur in the future.  The pro forma for immaterial
transactions are not included in the pro forma information.

In October 5, 2000 the Company acquired the auction web site Sonic
Auction for 500,000 (@$.01 per share equals $5,000) shares of
restricted stock as per rule 144.  The site primarily was a database
and a functioning web auction site. Since the web site did not
generate revenue at the time of acquisition it did provide an
additional database that the Company could use to cross-market other
Company products to; therefore a Performa was not developed for this
acquisition.

4.  CERTAIN FINANCIAL STATEMENT INFORMATION

                                                 December 31      June 30
                                                      2001          2001

Accounts receivable:
 Accounts receivable                             $   366,250    $   396,977
 Less:  allowance for doubtful accounts             (72,320)       (196,009)

 Accounts receivable, net                        $   293,930    $   200,968

Mortgage loans held for sale:
 Mortgage loans held for sale                    $ 6,474,470    $ 7,049,096
 Less:  allowance for loan losses                    (85,370)      (119,372)

 Mortgage loans held for sale, net               $ 6,388,740    $ 6.929,724

Property and equipment:
 Office furniture and equipment                  $    45,242    $    47,155
 Machinery and computer equipment                  2,801,928      2,239,781
 Leasehold improvements                               10,026          1,726
 Less:  accumulated depreciation                    (681,771)      (418,881)

 Property and equipment, net                     $ 2,175,425    $ 1,869,781

Intangible assets:
 Capitalized software costs, including websites  $ 1,322,518    $ 1,270,156
 Subscriber member bases                           1,302,118      1,302,118
 Others, including customer lists, existing
 technology, trade names                             423,386        423,386
 Less:  accumulated amortization                    (791,811)      (451,963)

 Intangible assets, net                          $ 2,256,211    $ 2,543,697

5.  REVOLVING LINES OF CREDIT

The Company has a master mortgage loan warehousing agreement (credit
facility) with a lender that provides a maximum of $5,000,000 under
specified conditions to fund residential mortgages to customers.  The
residential loans serve as collateral, and funds are advanced up to
98% of the unpaid principal amount of the qualified mortgage loan
granted to the customer.  The credit facility bears interest at the
Prime Rate (9.5% at June 30, 2000) plus 1.0% for loans outstanding for
60 days or less.  The interest rate increases to Prime Rate plus 4.0%
for loans outstanding between 60 and 120 days, and increases to Prime
Rate plus 6.0% for amounts outstanding over 120 days.  At June 30,
2001 and 2000, amounts outstanding under the credit facility were $0
and $2,579,346, respectively.  Subsequent to June 30, 2000, the credit
facility was amended to reduce the maximum available facility to
$3,500,000, and the Company did not renew the line when it came up for
renewal during the fiscal year ending June 30, 2001.

On February 1, 2000, the Company entered into a Master Repurchase
Agreement that provides the Company with a warehouse facility through
IMPAC Warehouse Lending Group ("IMPAC").  The IMPAC line provides the
Company with an open warehouse credit line (as set forth by IMPAC) for
the Company's mortgage originations only. Under the terms of the
agreement, the Company must repay the funded amount within 30 days of
the date the funds were disbursed with interest at the Prime Rate plus
1.0%.  If the funds are not repaid within 30 days, the interest rate
increases to Prime Rate plus 3.0% until repaid, and IMPAC reserves the
right to sell the loan and any shortfall remains the liability of the
Company.  The IMPAC line is secured by the mortgage loans funded with
the proceeds of such borrowings.  The IMPAC line does not have a
stated expiration date but it is terminable by either party upon
written notice.  Amounts outstanding under the IMPAC line at June 30,
2001 and 2000, were $ 6183,228 and $ 254,217, respectively.

On March of 2001, the Company entered into a Master Repurchase
Agreement that provides the Company with a warehouse facility through
Imperial Warehouse Lending Group ("Imperial").  The Imperial line
provides the Company with an open warehouse credit line (as set forth
by Imperial) for the Company's mortgage originations only. Under the
terms of the agreement, the Company must repay the funded amount
within 30 days of the date the funds were disbursed with interest at
the Prime Rate plus 1.0%.  If the funds are not repaid within 30 days,
the interest rate increases to Prime Rate plus 3.0% until repaid, and
Imperial reserves the right to sell the loan and any shortfall remains
the liability of the Company.  The Imperial line is secured by the
mortgage loans funded with the proceeds of such borrowings.  The
Imperial line does not have a stated expiration date but it is
terminable by either party upon written notice.  Amounts outstanding
under the IMPAC line at June 30, 2001 and 2000, were $ 865,468 and $
0, respectively.

The effective interest rate for the credit lines listed above were as
follows per quarter, the interest charge is deducted from the sale
proceeds of the funded loans and is booked as a cost of revenue;

Quarter          Prime Rate       IMPAC       Imperial*      Number of Loans
                                                             Held over 30 Days

Sept. 30 2000       9.50%          10.5%         N/A                 0

Dec. 31, 2000       9.50%          10.5%         N/A                 0

March 31, 2001      8.0%            9.0%         9.0%                0

June 30, 2001       6.75%           7.75%        7.75%               0

* Imperial line not in use prior to March 2001

In addition, the Company has a bank line of credit that provides for
maximum borrowings up to $125,000.  The line of credit is personally
secured by certain officers of the Company, and currently bears
interest at 11.5% at June 30, 2000 and is due on August 31, 2000.  The
outstanding balance against the line of credit as of June 30, 2001 and
2000 were $ 0 and $125,000, respectively. The Company paid off the
line of credit line during the fiscal year ending June 30, 2001,
because it was no longer required.

All credit facilities and bank line of credit require the Company to
maintain certain financial ratios and adhere to specific non-financial
requirements.

IMPAC Warehouse Lending Group ("IMPAC") stopped funding the Companys
loans at end of November 2001, because of the large volume of loans
the Company had in processing far exceeded the Companys current line
capabilities. Due to this situation  the Company applied to PCFS
financial services and the company was approved for a new line that
will be expandable to meet the Companys funding needs. The terms of
this line are the same terms as the previous credit line with IMPAC.
This had a negative impact on our staff, and the Company was required
to reduce the Guarantee Funding Capital staff to 3 by December 31 2001.

6.  LONG-TERM DEBT

Long-term debt at June 30, 2001 consists of the following:

                                        Current      Long-term     Total
                                         Portion

Note payable secured by certain Company
assets, requiring monthly payments of
$6,494, including interest at 12.25%,
due May 5, 2007                         $   40,506   $ 283,014     $ 323,520

During the fiscal year certain real estate loans defaulted. The
Companys subsidiary is making payment to the lender that purchased the
defaulted loans. These payments are made at the note rate for each
loan. The Company has filed claims with the Companys E&O Insurance
carriers. and until the claims are either denied or paid the company
lists these debts as long-term debt. These notes total $844,933.

Effective September 1, 2001, the Company sold the subsidiary Atlas
Capital and these liabilities are included in the sale.

7.  EXTRAORDINARY ITEM

After review by legal counsel about the predecessor company's (see
Note 1) unsecured prior debts, it was determined by legal counsel the
Company was no longer liable for certain of the predecessor company's
unsecured debt and management elected to write-off the debts during
the fiscal year ended June 30, 1999 and is included as an
extraordinary item as forgiveness of debt income.

8.  STOCKHOLDERS' EQUITY

Authorized Shares

During November 2000, the Board of Directors of the Company amended
the Articles of Incorporation to increase the number of authorized
shares of common stock to 349,000,000 shares.

Stock Issuance

At the end of this quarter there were a total number of 282,736,029
common snares issued and outstanding of which 94,582,267 are restricted.

During this quarter ended December 31, 2001  no additional shares were issued.

During the quarter ended September 30, 2001, the following shares were
issued: 15,500,000 as per employment contract.

The Company had and issued and outstanding 267,236,029 by the end of
the previous fiscal year ending June 30, 2001.

During the quarter ending June 30, 2001 the following shares were
issued: 19,499,430 additional for the conversion of the Preferred
Stock  (that were originally issued December 15, 1998) into common stock.

During the quarter ending December 31, 2000, the following shares were
issued: 1. 500,000 shares of restricted 144 stock for the acquisition
of Sonic Auction.Com and 2. 7,140,406 shares of common stock were
issued pursuant to the agreement with the conversion rights of the
Preferred Stock issued December 15, 1998, upon the 10 day average of
the closing bid price prior to the conversion date.

During the quarter ending March 31, 2001 the following shares were
issued; 18,981,080 in exchange for Preferred Stock that was originally
issued December 15, 1998.

During March 2000, the Company issued 7,000,000 shares of common stock
through a private placement transaction, resulting in net proceeds to
the Company of $3,382,560.

The Company also issued 6,422,667 and 8,000,000 shares of Company
stock in connection with the acquisition of businesses or net assets
during the fiscal years ended June 30, 2000, and 1999, respectively.
The Company also issued 30,389,449 and 11,242,790 shares of Company
stock in connection with services provided or rendered during the
fiscal years ended June 30, 2000 and 1999, respectively.

Preferred Stock

On December 15, 1998, the Company entered into an agreement with Iron
Horse Holdings, Inc. ("IHHI"), a privately held company that in which
officers or family members of the officers of the Company have
minority stock ownership. This agreement consisted of for IHHI to
purchase 23,900 shares of the Company's preferred stock with a par
value of $100.00 per share, in exchange for a promissory note
receivable from IHHI in the amount of $2,500,000.  The difference
between the par value of the shares and the purchase price is treated
as additional paid-in-capital.  Shares purchased under the agreement
are to be issued to IHHI or its designee.  The promissory note
receivable bear interest at 9% per annum and is secured by a blanket
security agreement executed by IHHI and perfected by filings as
specified by law.  Until such note is paid in full, IHHI shall pay the
3% coupon on such shares as are issued under the agreement directly to
the shareholder(s) of record at the time such payment is due. During
the fiscal year ending June 30, 2001, the company-received payment in
full on the note executed by IHHI, also during this fiscal year IHHI
converted the preferredstock into common stock. There are no preferred
shares issued and or outstanding as of this date.

During Fiscal June 30, 2000, the Company received the following
payments on the note executed by IHHI:

Date                 Balance          Payment        Interest Paid

June 30, 1999        $1,735,000
Sept. 30, 1999        1,464,754       $  270,246       $  39,037
Dec. 31, 2000         1,194,508          270,246          32,957
March 31, 2000          924,262          270,246          26,876
June 30, 2000           654,009          270,253          20,796

Total                $  654,009       $1,080,991       $ 119,666

During Fiscal June 30, 2001 the Company received the following
payments on the note executed by IHHI,

Date                 Balance          Payment        Interest Paid

June 30, 2000       $  654,009
Sept. 30, 2000         490,509        $  163,500      $  14,715
Dec. 31, 2000          327,009           163,500         11,036
March 31, 2001         163,509           163,500          7,357
June 30, 2001                0           163,509          3,679

Total               $        0        $  654,009      $  36,787

9.  INCOME TAXES

The provision for income taxes for the second quarter ending  December
31  and years ended June 30, 2001  consist of the following (there
were no provision for income taxes on the financials due to the net
loss carry forward from the previous years operations):

                                               December 31      June 30
                                                    2001          2001

Current income tax expense:
 Federal                                        $   30,930     $  269,795
 State                                                   0              0
                                                    30,930        269,795
Deferred income tax expense:
 Federal                                        $        0     $        0
 State                                                   0              0
                                                         0              0

                                                $        0     $        0

Amounts for deferred income tax assets and liabilities as follows:

Assets                                          $   30,930     $  269,795
Valuation allowance                                (30,930)      (269,795)
                                                         0              0
Liabilities                                              0              0

Net tax asset or liability                      $        0     $        0

Deferred income tax assets consist primarily of net operating loss
carry forwards.  The Company has provided for a full valuation
allowance on the deferred income tax assets as the realization of such
benefits are uncertain.  Such carry forwards begin to expire beginning
in 2004.

For the second quarter ended December 31, 2001 and year ended June 30,
2001, the Company excluded the forgiveness of debt income from taxable
income pursuant to Internal Revenue Code Section 108(A)(1)(B) and 108(B).

10.  COMMITMENTS

The Company leases all of its offices, and the Company moved several
of its offices during the first quarter of this fiscal year. This has
reduced the Companys monthly obligations for several locations during
the 2nd quarter of this fiscal year. The future minimum rental
commitments at December31, 2001 under these leases are as follows:

Corporate Headquarters         4634 S. Maryland Pky, Suite 107, Las Vegas, Nev.
                               89119
                               $2451 per month ending 6-02 total $44,118
West Coast Headquarters        3900 Birch Street, Suite 103, Newport
                               Beach, Ca. 92660
                               $2100 per month ending 3-02  total $31,500
International Headquarters     3 Boicho Voivoda str., 1024 Sofia,
                               Bulgaria  (monthly)

Guarantee Capital Group, a Corp 18004 SkyPark Ci. Suite 170, Irvine, Ca. 92614
                              $4500 per month ending 9-03 total $90,000
LA Internet, Inc.             550 Carson Plaza Drive Suite 127, Carson. Ca
                              90746
                              $2250 per month ending 12-04 $78,750
                              725 Main St. Suite 12, Woodland, Ca. 95695
                              $1270 per month ending 11-03 total $43,180
E Commerce                    1077 Goodman Rd., Hornlake, Mississippi 38637
                              $1400 per month ending 9-04 total $46,200

Several of these locations house  more then one subsidiary.
The commitment for the Company based upon the aforementioned leases
for the remaining quarters of this fiscal year is $83,826.
The Company also houses equipment at several co-location facilities.

11.  SEGMENT INFORMATION

In accordance with SFAS No. 131, "Disclosure about Segments of an
Enterprise and Related Information," management has determined that
there are four reportable segments based on the customers served by
each segment: full service internet service provider (ISP), mortgage
banking business, and business-to-business ("B2B") provider and
business-to-consumer ("B2C") provider. Such determination was based on
the level at which executive management reviews the results of
operations in order to make decisions regarding performance assessment
and resource allocation.

Full service Internet service provider serves customers requiring
Internet access in the western United States through dial-up, high-
speed wireless, web hosting and web design.  Mortgage banking business
includes online mortgage loan origination, processing, servicing and
resales. Business-to-business provider primarily provides reverse
auction services to foreign companies wishing to purchase materials
and supplies in the United States.  Business-to-consumer provider
primarily consists of cellular phone service origination fees and sales.

Certain general expenses related to advertising and marketing,
information systems, finance and administrative groups are not
allocated to the operating segments and are included in "other" in the
reconciliation of operating income reported below. The accounting
policies of the segments are the same as those described in the
summary of significant accounting policies (see Note 2).  Information
on reportable segments is as follows:

                                                       Six Months Ended
                                                  December 31     December 31
                                                      2001             2000

Full-service ISP
Revenue                                          $   2,166,014  $  1,402,448
Operating income                                 $     594,286  $    257,676
Mortgage loan originations held for resale
Revenue                                          $   1,800,359  $ 11,173,276
Operating income                                 $     290,619  $   (548,318)
E Commerce (B-to-b/c)
Revenue                                          $      99,846  $     42,816
Operating income                                 $     (46,982) $   (134,630)
Marketing (B-to-b/c)
Revenue                                          $       9,973  $     457,862
Operating income                                 $    (345,836) $    (335,065)
Other
Revenue                                          $     446,534  $     363,385
Unallocated expenses                             $    (397,464) $      28,073
Total
Revenue                                          $   4,522,726  $  13,439,787
Operating income                                 $      94,623  $    (732,264)

12. OTHER  EVENTS

a.  PMCC

On August 2, 2000, the Company announced that it has entered into an
agreement   whereby the Company would purchase 2,460,000 share of PMCC
Financial Corp. ("PMCC"), a full-service mortgage banking company,
common stock from PMCC's former chairman of the board, Ronald
Friedman, and The Ronald Friedman 1997 Grantor Retained Annuity Trust
Ronald Friedman, which represents 66.36% of the 3,707,000 PMCC shares
outstanding.  The aggregate purchase price of $3,198,000 is to be paid
in cash to the seller by the Company as follows: $700,000 at date of
closing; $306,857 for each of the seven installment payments to be
paid on the 30th, 60th, 90th, 120th, 150th, 180th and 210th days following
the close; $175,000 on each of the 240th and 270th day after the date
of the closing. Shares of PMCC, a listed AMEX company, were not
trading at the time of the agreement.  In the event that three months
after closing, if PMCC's shares are not actively trading on the AMEX
or NASDQ exchanges and the Company has not merged PMCC with the
Company or any of the Company's subsidiaries, the purchase price shall
be reduced by the amount of the final two $175,000 payments.

Also on July 28, 2000, in a separate transaction, the Company entered
into a stock purchase agreement with an unrelated individual whereby
the Company would sell up to 370,000 of PMCC shares that the Company
either owns or will eventually own, for total consideration of
$1,387,500.  Shares of PMCC stock sold by the Company will be released
to the buyer in proportion to payments received.

The Company on March 2, 2001 filed an action against Ronald Friedman,
and The Ronald Friedman 1997 Grantor Retained Annuity Trust (Case
Number SA CV 01-268 DOC (Eex)) for recession of the purchase of the
PMCC stock and return of the $1,006,857 on August 16, 2001 Ronald
Friedman, Robert Friedman, and The Ronald Friedman 1997 Grantor
Retained Annuity Trust filed an action against the company (Case
Number 01CV 7637), for the balance of the contract in the amount of
$2,191,143.  The company action was filed in Orange County; CA. and
Mr. Friedman's complaint was filed in Southern District, New York. The
company feels that it will prevail in both actions.

As of December 31, 2000, the Company received payments of $559,812 and
the Company released 149,283 shares of PMCC stock that it owned.  If
PMCC is not actively trading within six months of the agreement, the
Company will issue to the Buyer the equivalent number of shares of
stock of the Company.  PMCC has been actively trading as of January
19, 2001, and the gain on the sale of the PMCC stock of $410,529 has
been included in revenues for the period ending December 31, 2000.

In January 2001, the PMCC was delisted from the American Stock
Exchange and began trading on the Pink Sheets under the symbol of
"PMCF"; this met the trading requirement as per the stock sale
agreement the Company had entered into with an unrelated individual
during the first quarter of this fiscal year.

b.  IBC

On August 11, 2000, the Company entered into an agreement to acquire
all of the outstanding shares of International Business Co., a
software developer that streamlines B2B e-commerce, in exchange for
2,000,000 shares of restricted Company shares to be held in escrow.
Between the periods from September 1, 2000 through March 1, 2001, the
Company can unilaterally cancel the contract if dissatisfied with the
seller's performance. The Company canceled the purchase during the
cancellation period agreed in the escrow.

c.  Auction-Sales.Com, Inc.

On October 19, 2000, the Registrant entered into a Stock Purchase
Agreement with Auction-Sales.Com, Inc. and its majority shareholder,
Zahid Rafiq (collectively, "Seller"), for the purchase by the
Registrant of 96.62% of the outstanding and treasury shares of common
stock of Auction-Sales.Com, Inc., a Delaware corporation (see Exhibit
10.15 of this Form 10-Q).  In exchange for the shares, the Registrant
will pay, under the terms of this agreement, the following:

     (a)  11,000,000 shares of Registrant's restricted common stock to
Seller for all of Seller's Shares, as follows:

     (i)  5,500,000 restricted shares will be issued to current
          shareholders, identified on the list attached to the
          Agreement.

     (ii) 2,500,000 restricted shares will be paid to certain
          creditors of the Registrant identified in an attachment to
          the Agreement.  Seller represents that all of these
          creditors are unsecured.  Seller shall procure signed
          consents from each creditor confirming the agreement to
          accept restricted shares in proportion to their claims
          within 60 days of closing of the transaction.  Failure to
          procure signed consents will justify rescission of this
          Agreement at the option of the Registrant, such that each
          party shall restore to the other the consideration which
          each placed into the Agreement.

     (iii) 3,000,000 restricted shares of the purchase
          price will be paid to outside consultants for work performed
          for facilitating the transaction.

     (b)  Earn out for the "Seller": The Seller shall be paid up to an
additional $3,000,000 based upon earnings over the next 3 years
through additional restricted stock.  The earn out will be based on a
10% growth per year over the previous years revenue.  The $3,000,000
will be distributed equally over the subsequent 3 year i.e. $1,000,000
per year, and can be cumulative.  This earn out is further defined as
follows:

     (i)  The initial base Year ends on September 30, 2000.  The
          subsequent year base will be the previous revenue.

     (ii) The stock will be issued per quarter upon reaching the
          Goal per quarter for that portion of the annualized growth of
          10% over the previous year.

     (c)  The Registrant may invest up to $2,000,000 in Auction-
Sales.Com, Inc., at a rate not to exceed $500,000 per quarter, based
on performance on Auction-Sales.Com as a function of gross revenues
and based on a budget, which is pre-approved by the Registrant.

Auction-Sales.Com is an e-commerce pricing application service
provider.  Auction-Sales.Com has developed a proprietary state of the
art hybrid auction platform that address the combined needs of the
B2C, B2B and C2C markets. This is accomplished by providing a single
integrated marketplace and portal technology that empowers all
parties, including manufacturers, distributors, resellers and
consumers.  The Auction-Sales.Com platform provides supply chain
integration and economies of scale in connection with dynamic pricing
application targeting businesses and /or consumers.

     This acquisition was rescinded in December 2000 and the necessary
documents were filed with the SEC.  The site was retained until the
funds invested into Auction-Sales.Com are returned which at this time
management has very low expectations of occurring.

13. OTHER AGREEMENTS

a.  Washington State Hotel and Motel Association.

     The agreement, entered into in the ordinary course of business,
with the Washington State Hotel and Motel Association, dated October
4, 2000, provides the use of the GGPP reverse auction site as a
platform for hotel association members purchasing products needed for
their different hotel properties.  This method of purchasing allows
the suppliers of products the chance to sell products to the buyers in
competition with one another; the net effect is that the buyers would
select the supplier with the lowest per unit cost.  This reduces the
cost of supplies and thereby should increase their potential of
profit.  This agreement covers the modification of the GGPP website
for use by the Association, and does not involve any payment by the Registrant.

b.  JWC Construction

     The agreement, entered into in the ordinary course of business,
with the JWC Construction Company of Poland, dated March 9, 2001 which
will enable companies to list their purchasing requirements on
projects using the reverse auction platform. This method of purchasing
allows the suppliers of products the chance to sell products to the
buyers in competition with one another; the net effect is that the
buyers would select the supplier with the lowest per unit cost.  This
reduces the cost of supplies and thereby should increase their
potential of profit.  This agreement covers the modification of the
Construction Buying Group website for use by the Construction
industry, and does not involve any payment by the Registrant.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS.

     The following discussion should be read in conjunction with the
financial statements of the Registrant and notes thereto contained
elsewhere in this report.

Current Operations

The Registrant currently operates four reporting divisions:

Corporate Headquarters    4634 S. Maryland Pky, Suite 107 Las Vegas, Nev. 89119
West Coast Headquarters   3900 Birch Street, Suite 103, Newport Beach, Ca 92660
International Headquarters 3 Boicho Voivoda str., 1024 Sofia, Bulgaria

(1)  ISP (which includes a national dial-up ISP: a wireless high
     speed ISP in Las Vegas, NV, Moreno Valley, CA, and Woodland, CA;
     and Internet web design and hosting businesses.)
     LA Internet, Inc       550 Carson Plaza Drive Suite 127, Carson. Ca. 90746
     dba  BeyonDSL          4634 S Maryland Pkwy, Suite 107, LV, NV 89119
                            725 Main St. Suite 12, Woodland, Ca. 95695

(2)  Mortgage Loan On-line Lending (which includes real estate
     loans and equipment leasing.)
     Guarantee Capital Group, a Corp.  18004 SkyPark Ci. Suite 170 Irvine Ca.
     92614

(3)  Marketing (which includes the direct marketing of long
     distance phone services, computers with Internet access, wireless
     high speed Internet access and bandwidth.)
     First 2 Market          4634 S Maryland Pkwy, Suite 107, LV, NV 89119

(4)  E Commerce (which includes auction sites, B2C and B2B
     eCommerce, and reverse auction sites for Europe and the United
     States),
     Ace Optics                  1077 Goodman Rd., Hornlake, Mississippi 38637

The Registrant employee over 40 people and has 7 offices, six offices
in the US and one in Europe

Results of Operations - Comparison of Quarter Ended December 31 2001
to Quarter Ended December 31, 2000.

(a)  Overall

Prior to July 1, 2001, the Registrant recognized the gross loan
amount funded as revenue; effective July 1, 2001 the Registrant will
only recognize the net proceeds received from the sale of that loan
when that loan is sold.  This change does not affect the net income
(loss) for the period and the net results can be compared to prior periods.

Revenues for the second quarter ended December 31, 2001 of
$4,522,726, which is a decrease of approximately 296% when compared
with revenues of $13,439,787 in the prior year.  This revenue decrease
is mainly due to the change in accounting methods of booking revenue.

Selling, general and administrative expenses for the second
quarter ended December 31, 2001 of $3,598,865 is an increase 3% of
when compared to the same expenses of $3,420,286 for the same time
period for the previous fiscal year 2000.

The resulting profit for the six month period ended December 31,
2001 of $94,623 was a significant increase when compared to the loss
of ($732,264) reported for comparable quarter ended December 31, 2000.
The Registrant has concentrated on reducing cost and increasing revenue.

(b)  Comparison by Segment

Management has determined that there are four reportable segments
based on the customers served by each segment: Full service internet
service provider (ISP), mortgage banking business, and e-commerce
("B2BC") business-to-business and or to-consumer provider and
marketing ("B2B") business-to-business and ("B2C") business-to-
consumer. Such determination was based on the level at which executive
management reviews the results of operations in order to make
decisions regarding performance assessment and resource allocation.

Certain general expenses related to advertising and marketing,
information systems, finance and administrative groups are not
allocated to the operating segments and are included in "other" in the
reconciliation of operating income reported below.  Information on
reportable segments is as follows:
                                                          Six Months Ended
                                                  December 31        December31
                                                     2001              2000

Full-service ISP
Revenue                                           $  2,166,014     $ 1,402,448
Operating income                                  $    594,286     $   257,676
Mortgage loan originations held for resale
Revenue                                           $  1,800,359     $11,173,276
Operating income                                  $    290,619     $  (548,318)
E Commerce (B-to-b/c)
Revenue                                          $      99,846     $    42,816
Operating income                                 $     (46,982)    $  (134,630)
Marketing (B-to-b/c)
Revenue                                          $       9,973     $   457,862
Operating income                                 $    (345,836)    $  (335,065)
Other
Revenue                                          $     446,534     $   363,385
Unallocated expenses                             $    (397,464)    $    28,073
Total
Revenue                                          $   4,522,726     $13,439,787
Operating income                                 $      94,623     $  (732,264)

The results for the ISP service (see locations and services
listed in Current Operations) for the second quarter ended December
31, 2001 of $2,166,014 is and increase of 154% when compared to the
same period ended December 31, 2000 of $1,402,448. The increase is
from concentration on the high-speed Internet accesses and increase in
web sale activities. The profits of $594,2286 for the six months ended
December  31, 2001 is a increase of 231 % for the same period of the
previous fiscal year which reported profits of $257,676.  The
improvement in the profit margins is due to the fact that the profit
margins are greater in the wireless Internet access then the standard
dial up access.

The results for the Mortgage Division were impacted by the
following reasons:

(a)  The change in the way revenue is recorded; and

(b)  The Mortgage Division generated over $16,000,000 of mortgage
loans that were due to be funded in the last 2 months of the quarter.
The IMPAC funding line was at capacity which prevented the Registrant
from funding those loans and resulted in the Registrant obtain a
different funding line with PCFS in December 2001. This new line
didn't become operational in time to save the $16,000,000 of loans
that were approved and ready to fund.  This resulted in the Registrant
reducing its personnel in that division from over 23 to just 3 by the
end of the second quarter.

The results for Mortgage Originations (see location and services
listed in Current Operations) for the second quarter ended December
31, 2001 of $1,800,359 which is a decrease of 494.9% when compared to
the same period ended December 31, 2000 of $11,173,276. The profits of
$290,619 for the six months ended December 31, 2001 is a significant
improvement over the same six-month period of the previous fiscal year
which reported losses of ($548,318).

The results for the E Commerce  (see location and services listed
in Current Operations) for the second quarter ended December 31, 2001
of $99,846 which was an increase in sales for the same period, ended
December 31, 2000 of  $42,816. The loss of ($46,982) for the six
months ended December 31, 2001 is an improvement over loss for the
same period of the previous fiscal year, which reported a loss of
($99,789).  The Registrant plans to continue this division's operation
and anticipates it becoming profitable by the end of this fiscal year.

The results for the Marketing (see location and services listed
in Current Operations) for the second quarter ended December 31, 2001
of  $9,264 is and decrease of 459% when compared to the same period
ended December 31, 2000 of $457,862. The main reason for the decrease
was the decision to stop selling cell phones and began marketing
Registrant products. The losses of ($345,836) for the same period are
an increase of 9.8 % for the same period of the previous fiscal year,
which reported losses of ($335,065).  The increase in the losses was
also due to the change over in the marketing of products. The
Registrant currently does not use other means of informing the
consumer about the products and services that the Registrant offers
other then the Internet. The Registrant feels that Direct Marketing is
the most effective means to market it's products and services to the
non Internet Consumer. The Registrant is still trying to develop an
effective direct marketing program.

The results for Other Revenue are from a service charge that is
generated from the new marketing services that is provided by
corporate to its clients. The revenue of $446,534 for this period
ended December 31, 2001, is not to be compared to the prior period
ended December 31, 2000, which revenue of 363,385 from sources other
then the current marketing services.  The losses of  ($397,464) for
the six months ended December 31, 2001 is a decrease from the profits
of $28,073 reported for the same six month period of the previous
fiscal year.

Liquidity and Capital Resources.

Net cash provided by the operations of the Registrant of $94,623
for the six months ended December 31, 2001, is a significant
improvement when compared to the net cash provided by operating
activities of ($732,262) in the comparable prior year period. The
Registrant plans on expanding its wireless Internet services at an
increased rate and therefore it is considering additional sources for
raising capital for this expansion. The increased rate for expansion
is due to the greater then expected increase in  demand for the
wireless Internet services in both Las Vegas, Nevada  and Woodland,
California.  The Mortgage Division will be in the process of rebuilding
during the 3rd Quarter and will not a substantial conrtibuter during
that quarter as it has been in the past. The Company has sufficient
Capital to rebuild the Mortgage Division during third quarter and
expect it to be profitable again in the 4th Quarter of this fiscal year.

Capital Expenditures.

Other than as set forth below, no material capital expenditures
were made during the quarter ended on December 31, 2001: purchase
infrastructure equipment totaling $245,405.

Acquisitions

There were no acquisitions made during the quarter ended December
31, 2001.

Forward Looking Statements.

The foregoing Management's Discussion and Analysis of Financial
Condition and Results of Operations contains "forward looking
statements" within the meaning of Rule 175 of the Securities Act of
1933, as amended, and Rule 3b-6 of the Securities Act of 1934, as
amended, including statements regarding, among other items, the
Registrant's business strategies, continued growth in the Registrant's
markets, projections, and anticipated trends in the Registrant's
business and the industry in which it operates.  The words "believe,"
"expect," "anticipate," "intends," "forecast," "project," and similar
expressions identify forward-looking statements.  These forward-
looking statements are based largely on the Registrant's expectations
and are subject to a number of risks and uncertainties, certain of
which are beyond the Registrant's control.  The Registrant cautions
that these statements are further qualified by important factors that
could cause actual results to differ materially from those in the
forward looking statements, including, among others, the following:
reduced or lack of increase in demand for the Registrant's products,
competitive pricing pressures, changes in the market price of
ingredients used in the Registrant's products and the level of
expenses incurred in the Registrant's operations.  In light of these
risks and uncertainties, there can be no assurance that the forward-
looking information contained herein will in fact transpire or prove
to be accurate.  The Registrant disclaims any intent or obligation to
update "forward looking statements."

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Market risk generally represents the risk of loss that may result
from the potential change in the value of a financial instrument due
to fluctuations in interest rates.  Market risk is inherent to both
derivative and non-derivative financial instruments, and accordingly,
the scope of the Registrant's market risk management includes all
market risk sensitive financial instruments.

     The Registrant uses several tools and risk management strategies
to monitor and address interest rate risk.  Such tools allow the
Registrant to monitor and evaluate its exposure to these risks and to
manage the risk profile of its residual interest portfolio in response
to changes in the market risk.

     The Registrant measured the sensitivity of the current value of
cost of funds (Prime Rate plus 1.5%) to changes in the mortgage
interest rate (bond market plus 1.5%) that the Registrant charges on
funded loans, which is reflected with changes in interest rates.  The
difference in the cost of funds versus the rate the Registrant funded
the mortgage loans could have benefited the company because the cost
of funds was less the mortgage interest rate, or the Registrant could
loss money if the cost of funds was more than the mortgage interest rate.

     The following table summarizes the sensitivity analysis of change
in the fair value of our cost of funds as compared to the residual
interests as of December 31, 2001 and September 30, 2001:

                                               Change In Fair Value As Of:

                                               December 31     September 30
                                                  2001             2001

Prime Rate                                         4.750%          6.000%
Our Cost of Funds                                  1.500%          1.500%
Total                                              6.250%          7.500%

Bond Market                                        4.900%          4.575%
Consumer Cost of Funds                             1.500%          1.500%
Total                                              6.400%          6.075%

Net Impact Benefit (Loss)                          0.150%         (1.425)%

PART II.

ITEM 1.  LEGAL PROCEEDINGS.

     Other than as set forth below, the Registrant is not a party to
any material pending legal proceedings other than ordinary routine
litigation incidental to the business and, to the best of its
knowledge, no such action by or against the Registrant has been threatened.

     The Registrant on March 2, 2001 filed an action in the United
States District Court, Central District of California against Ronald
Friedman, and The Ronald Friedman 1997 Grantor Retained Annuity Trust
(Case Number SA CV 01-268 DOC (Eex)) for rescission of the purchase of
the PMCC stock and return of the $1,006,857.  On August 16, 2001
Ronald Friedman, Robert Friedman, and The Ronald Friedman 1997 Grantor
Retained Annuity Trust filed an action in the United States District
Court, Southern District of New York against the Registrant (Case
Number CV 01-7637), for the balance of the contract in the amount of
$2,191,143.  Each side has filed an answer to the complaints.  The
Registrant intends to contest this matter vigorously.  Management
cannot take any position at this time as to the likely outcome of the matter.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS.

     The Registrant did not issue any unregistered securities during
the quarter ended December 31, 2001.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.

     Not Applicable.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

     None.

ITEM 5.  OTHER INFORMATION.

     None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

Reports on Form 8-K.

     No reports on Form 8-K were filed during the second quarter of
the fiscal year covered by this Form 10-Q as follows

Exhibits.

Exhibits included or incorporated by reference herein are set
forth in the Exhibit Index.

                                       SIGNATURE

     Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                   Internet Business's International, Inc.



Dated: February 13, 2002           By: /s/ Albert R. Reda
                                   Albert R. Reda, Chief Executive Officer

                                 EXHIBIT INDEX

Number                          Description

2.1     Agreement and Plan of Merger between the Registrant and
        Internet Business's International, Inc., a Delaware
        corporation, dated July 1, 1999 (incorporated by reference
        to Exhibit 2 of the Form 8-K/A filed on November 22, 1999).

2.2     Agreement and Plan of Merger and Share Exchange among the
        Registrant, Return Assured Incorporated, and IBUI
        Acquisition Corporation, dated June 4, 2001 (incorporated by
        reference to Exhibit 2.2 of the Form 10-K filed on October
        1, 2001).

3.1     Articles of Incorporation (incorporated by reference to
        Exhibit 3.1 of the Form 10-Q filed on December 1, 1999).

3.2     Certificate of Amendment of Articles of Incorporation
        (incorporated by reference to Exhibit 3.2 of the Form 10-Q
        filed on December 1, 1999).

3.3     Certificate of Amendment of Articles of Incorporation
        (incorporated by reference to Exhibit 3.3 of the Form 10-Q
        filed on May 22, 2000).

3.4     Certificate of Amendment of Articles of Incorporation
        (incorporated by reference to Exhibit 3.4 of the Form 10-Q
        filed on May 22, 2000).

3.5     Bylaws (incorporated by reference to Exhibit 3.3 of the Form
        10-Q filed on December 1, 1999).

4.1     Retainer Stock Plan for Non-Employee Directors and
        Consultants, dated October 1, 1999 (incorporated by
        reference to Exhibit 4.1 of the Form S-8 filed on October 8, 1999).

4.2     Consulting Agreement between the Registrant and Mark Crist,
        dated October 5, 1999 (incorporated by reference to Exhibit
        4.2 of the  Form S-8 filed on October 8, 1999).

10.1    Purchase Agreement (LA Internet) between the Registrant and
        Iron Horse Holdings, Incorporated, dated June 10, 1999
        (incorporated by reference to Exhibit 10.2 of the Form 10-Q
        filed on December 1, 1999).

10.2    Purchase Agreement between the Registrant and the
        Stockholders of MBM Capital Group Inc., dated July 1, 1999
        (incorporated by reference to Exhibit 10.3 of the Form 10-Q
        filed on December 1, 1999).

10.3    Acquisition Agreement (Net 2 Loan) between the Registrant
        and Lifestyle Mortgage Partners, dated September 15, 1999
        (incorporated by reference to Exhibit 10.4 of the Form 10-Q
        filed on February 22, 2000).

10.4    Purchase Agreement (license) between the Registrant and
        Stockholders of California Land & Home Sale, Inc., dated
        October 1, 1999 (incorporated by reference to Exhibit 10.5
        of the Form 10-Q filed on February 22, 2000).

10.5    Acquisition Agreement (Optical Brigade) between the
        Registrant and Wade Whitley, dated November 1, 1999
        (incorporated by reference to Exhibit 10.6 of the Form 10-Q
        filed on February 22, 2000).

10.6    Employment Agreement between the Registrant and Al Reda,
        dated January 1, 2000 (incorporated by reference to Exhibit
        10.6 of the Form 10-K filed on October 1, 2001).

10.7    Employment Agreement between the Registrant and Louis
        Cherry, dated January 1, 2000 (incorporated by reference to
        Exhibit 10.7 of the Form 10-K filed on October 1, 2001).

10.8    Agreement for Acquisition between the Registrant and Direct
        Communications, Inc., dated February 25, 2000 (incorporated
        by reference to Exhibit 10.6 of the Form 10-Q filed on May
        22, 2000).

10.9    Agreement between the Registrant and Internet 2xtreme, dated
        March 6, 2000 (incorporated by reference to Exhibit 10.7 of
        the Form 10-Q filed on May 22, 2000).

10.10   Agreement between the Registrant, Roanoke Technology Corp.,
        and Global GPP Corp., dated March 21, 2000 (incorporated by
        reference to Exhibit 10.8 of the Form 10-Q filed on May 22, 2000).

10.11   Agreement between GPP Hungary Kft and Haitec Magyarorazagi
        Kft, dated March 30, 2000 (incorporated by reference to
        Exhibit 10.9 of the Form 10-Q filed on May 22, 2000).

10.12   Stock Purchase Agreement between the Registrant and Atlas
        Capital Corporation, dated April 1, 2000 (incorporated by
        reference to Exhibit 10.10 of the Form 10-K filed on
        September 27, 2000).

10.13   Stock Purchase Agreement between the Registrant and Ronald
        Friedman, Robert Friedman, and The Ronald Friedman 1997
        Grantor Retained Annuity Trust, dated July 28, 2000
        (incorporated by reference to Exhibit 10.11 of the Form 10-Q
        filed on November 16, 2000).

10.14   Stock Sales Agreement between the Registrant and a buyer,
        dated July 28, 2000 (incorporated by reference to Exhibit
        10.12 of the Form 10-Q filed on November 16, 2000).

10.15   Stock Purchase Agreement between the Registrant,
        International Business Company, Dennis B. Ginther, Clifford
        J. Roebuck, Jadwiga L. Ginther, and Bogumila E. Basu , dated
        August 19, 2000 (incorporated by reference to Exhibit 10.13
        of the Form 10-Q filed on November 16, 2000).

10.16   Stock Purchase Agreement between the Registrant, Sonic
        Auction.com, Inc., and Brian Pruett, dated October 5, 2000
        (incorporated by reference to Exhibit 10.14 of the Form 10-Q
        filed on February 15, 2001).

10.17   Stock Purchase Agreement between the Registrant, Auction-
        Sales.Com, Inc., and Zahid Rafiq, dated October 19, 2000
        (incorporated by reference to Exhibit 10.15 of the Form 10-Q
        filed on February 15, 2001).

21      Subsidiaries of the Registrant (incorporated by reference to
        Exhibit 21 of the Form 10-K filed on October 1, 2001).